Bitcoin (BTC): The downturn won't last that long

Fri 25 Aug 2023 ▪ 3 min of reading ▪ by Eddy S.

The Bitcoin (BTC) price rebounded by over 1%, reaching a peak of $26,438. This rise is the result of several factors, including improved investor sentiment. The latter are beginning to ease liquidations on long positions.

A bitcoin on fire.

Bitcoin (BTC) rebounds thanks to buyers

The market is gradually recovering, with a rise in the flagship crypto. The price of BTC plummeted to $25,000 last week, after a long period of low volatility. Following this massive fall, the Relative Strength Index (RSI) became extremely oversold. This could be the catalyst for a potential rise in BTC.

According to Dan Morehead, founder of Pantera Capital, the market has seen enough. Bitcoin’s performance this summer has been noticeably lackluster compared to similar periods in the past.

To counter this, bitcoin (BTC) buyers have set up a solid defense at the $25,000 support/resistance level. Their aim was to prevent a potential drop to $20,000. This bullish outlook enabled the leading crypto to regain resistance at $26,000 and climb to $26,800.

Investors remain optimistic

The US stock market also opened higher on Thursday, with the S&P 500 and Nasdaq Composite gaining 1%. Wall Street’s gains came on the heels of the release of S&P Global’s flash U.S. composite PMI index. This showed that economic expansion in August was about to pause.

Indeed, investors are optimistic that consumer spending will decelerate soon. They are hoping that the US Federal Reserve will decide to suspend its rate hikes. A decision that would be absolutely favourable for bitcoin (BTC).

In addition, liquidations on long BTC positions also declined on Wednesday. According to Coinglass, bitcoin recorded $37.7 million in total liquidations, including $9.64 million in liquidated long positions. If things continue as they are, it could easily reach $28,000.

However, investors should remain cautious. The US Federal Reserve is due to publish its decision on economic policy in September. If it announces higher-than-expected rate hikes, this could put the brakes on bitcoin’s (BTC) advance.

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Eddy S. avatar
Eddy S.

Le monde évolue et l'adaptation est la meilleure arme pour survivre dans cet univers ondoyant. Community manager crypto à la base, je m'intéresse à tout ce qui touche de près ou de loin à la blockchain et ses dérivés. Dans l'optique de partager mon expérience et de faire connaître un domaine qui me passionne, rien de mieux que de rédiger des articles informatifs et décontractés à la fois.


The views, thoughts, and opinions expressed in this article belong solely to the author, and should not be taken as investment advice. Do your own research before taking any investment decisions.